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Average single gumball gross?


Rick

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I realize this is more of a theoretical question, but for anyone who does/has run large single head GB routes, (I'm talking more than 250 locations) what would be your definition of a "safe" average to estimate per head per month?

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This will be interesting to hear. I've heard between 7 and 10.00 a month depending on area and obviously location. I've toying with this idea for awhile now. I just picked up some machines and will have them ready next week some time. 2 of which are going to be gumball machines! At 35.00 per stand, it won't take long to make the money back!

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That depends upon the locations an operator decides to keep. We all like to thin out the slow stops and relocate machines to get the most out of them, if $10 is unacceptable to you then your average will be something over $10! If $8.50 is acceptable to your average will be lower.

The better question is how long a service period will a location tolerate and how cheap can I get a machine out. Don't go to a location until there is at least $35 in a machine.

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Let me rephrase:

A vendor buys 700 NW60s and hires an in person locator with a good reputation to place all of them. There are no replacement locations.

The russian mafia then kidnaps your wife and her life depends on you correctly betting the over/under on the above route netting $2800/month after ALL expenses. Which would you choose?

 

And if you're taking the under, how low would the number need to go before you took the over?

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It would be pretty hard not to make that. That's only 4.00 a head average. You could make that amount in your area.

 

Keep in mind, we're not talking gross any more, rather true net.  And there's a ton of information you don't have like the density of population or the vehicle the vendor is using for service.  Big difference between a Prius and an F-150. Taxes, condition of equipment, etc.  But the mafia doesn't care.  You have to choose based on the information given.  

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Why even bother with singles? They don't really take that much less time to service than a double or 4 way rack and make a lot less. I like to measure my productivity in dollars per hour, and when you factor in driving time then singles are horrible. I only have one single on my route and if I hadn't got if for free I never would have a had it in the first place. The only thing I can think of that singles might be good for is as "scout" machines. Use them to gauge the potential of a location and then upgrade to double, 4 way rack, or larger depending on what the place will support.

 

Look at it this way: you drive 10 minutes between locations and spend 5 minutes servicing your single and gross $35 (after 60 or more days (very few singles make that much in a single month); you just made $140/hour and you won't make that same $140/hour for another 60 days or more.

 

Now let's take a 4 way rack. Most of my 4 way racks do $60-$90 per month. So let's split the difference and call it $75 per month. You drive the same 10 minutes between locations, spend 10 minutes servicing, and gross $75 (every month). You just made $225/hour, and you'll make that same amount pretty consistently every month.

 

And, for the grand finale, let's do an 8 way rack. These are much harder to place, so you obviously won't have a ton of them. But for the sake of example, I will cover it. My 8 way racks do between $150-$250 per month depending on location. We'll call that $200/month. You drive the same 10 minutes between locations, and spend 15 minutes servicing the rack. You just made $480/hour.

 

Adding more heads doesn't really add that much more service time. It's the travel time that kills your productivity and you can't really do much about it. Speed limits are what they are, you can't drive any faster (legally). The next best thing is to make more money per stop.

 

My focus is on racks, and to a lesser degree my cheap old doubles and triples that I use as scout machines to find rack locations.

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Why is it like like nailing jello to a tree - getting this question answered?  

 

Thank you for the response shepherd, at face value I agree with much of what you have to say.  

 

What happens to the numbers when you factor in time researching/emailing/ordering/storing/load/unload myriad 1", 2", BB and Flat @ 25%-30% COG and pay 20%-35% commission to the location compared to running to Sams and grabbing 12-15 cases of Dubble Bubble for the month?  Racks crush singles on straight up monthly gross - hands down.  But it gets much more interesting when you factor costs and place a $ value on your non-service time.

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Racks are a great way to make money, but you have way more up front cost. You have commission in 95% of the higher end locations and so your dollars per hour is lower, but yes, racks in a tighter area are good. 

 

Whats it look like to have Oaks filled with gumballs? Here's the way I look at it, if I had that many machines available, I would put out all gumball machines except for may 100-200 heads. I would fill them 1/2 to 3/4.s up with 1080 ct gumballs (which you could order straight from the manufacturer for about 50 shipping or from Sams, but I would go with something different that the norm for the area), they I would check them all in 30 days.

At 30 days you decide on the service cycle for how much was used. I personally would try to make the cycle so that they were only 1/4 full when I filled them up again. Why would you stop unless you needed to? 

 

If you have a location that needs to be serviced every 30 days, add a cab back for more capacity! Then after you go through and figure out service cycles an determine which ones are worth it, then go back and talk to the ones that are doing better and add a single head candy or even better a toy! If it's really good, offer a rack and commission!

 

Single head gumball machines have made more people more money than anything else. The return the first couple cycles will be less, but after you figure out cycles, get the route set up in groups for ease of service and less money, you will make more money per stop. There are operators that have gone 1yr between cycles. Is that optimal? No, but it's like a piggy bank! LOL

 

If you ask some of the bigger operators, like Musser, hillbilly and so on, they love their single heads and that's what they're growing right now last time I saw. So if the bigger operators are going back to that, why would anyone go away from that?

 

Let's look at product cost! What's the product cost for gumballs? 2 1/2% shipped to your door! You have a Vistar in your backyard, I don't know if they have 1080 ct, but if you order a pallet, they will order it in for you and it will be cheaper than the manufacturer, or you can order from Ford.

 

The end result is you will have less invested on that end of it for equipment which is why I think your doing this. If it was me and I had some vacation time coming up, I would use it to put everything out and then service once on the weekends until it was dialed in.

 

On the locator end of it, NOPE, not a plug! LOL! There are lots of telemarketing locators out there that will do gumball machines way less than in person and will get similar results. There are some that will beat me in price just for the work, but the idea would be, discuss the terms with them because an in person locator won't give a warranty, they will give you up to 10% extra locations instead. If you discuss this with a telemarketer, they will do the same thing for you or will lower their cost without a warranty. That I know for a fact because I know I would.

 

Your question in short, yes, vehicle will make a difference, but I was taking into consideration the conversations you and I have had. I doubt you would use a f150 to service your route. Your a numbers guy. I service my route in a Van that gets 16 mi to the gallon, drive up to 150 mi for a route and pay a little in gas. Insurance will be mediocre. I just added a commercial coverage policy to my normal and is only 75.00 extra for 6 months! 

Then you figure product cost in, I would say that it would be less than 10% for overhead, or in the ball park.

 

Then you look at dollars per hour, if you run the route like suggested above you only have 5 min. per stop, not 30-40 for a rack. then figure in your monthly dues for labels, realistically, that's your biggest expense at 1.00 per machine per month. In the same amount of time you can service a rack, you can service 5+ gumball machines and have no commission in most cases. 

 

I could go further, but I think that's the bottom line. You can get deeper into it, but that's the idea. The big thing is the product. I believe it needs to be brighter like a neon gumball. With 1080 count you'll have longer service times, extra money per case, and will actually put product cost under 2%!


Why is it like like nailing jello to a tree - getting this question answered?  

 

Thank you for the response shepherd, at face value I agree with much of what you have to say.  

 

What happens to the numbers when you factor in time researching/emailing/ordering/storing/load/unload myriad 1", 2", BB and Flat @ 25%-30% COG and pay 20%-35% commission to the location compared to running to Sams and grabbing 12-15 cases of Dubble Bubble for the month?  Racks crush singles on straight up monthly gross - hands down.  But it gets much more interesting when you factor costs and place a $ value on your non-service time.

 

YES!

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On the locating side, I will definitely agree with you, Rodney. That is why I use singles, doubles, and triples as scout machines. Easy to get a foot in a door. Even if I don't have time to locate, any telemarketing locator can place these machines (except for LRU, they never managed to place anything for me because they claimed their phones don't work in my area [WTH?]). Once I get some good locations, out with the little machines and in with a 4 way or larger.

 

If you're spending 30-40 minutes servicing an 8 way rack, you must be doing it blindfolded. 20 minutes tops if you have to restock a bunch of heads. I can get in, collect quarters, do a light cleaning, and be gone in 12 minutes. On a bad day, if I have to restock (especially if it's 2" product) it might take 20 minutes. That's one reason I only have 2 locations with 2" products, and one of them I'm thinking about eliminating the 2" selections. There is absolutely NO POSSIBLE WAY you could drive to and service 5 single heads in the time it takes to service an 8 way rack. You would have to be driving a top fuel dragster at 300+ mph.

 

If you like simplicity and don't want to organize product, then singles are the way to go. If you don't mind organizing some stuff, then racks are way better.

 

Locations are very hard to get in my area, the communities in my area are very unfriendly toward bulk vending. Any time I can land a location, I stuff as many heads in there as it will support. I've had locators take weeks to place a double, and after all that effort find the place won't even support a single. Getting into the good locations is extremely tough around here. Most of my locations are in a city to my south that is a little friendlier to bulk vendors but has a ton of competition. Easy to get into, but harder to make money there. That's why I actually prefer to have commission locations in that area rather than charity. The locations are a little more willing to protect your territory if you're paying them something.

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The question simply can not be answered. I started out with single head gum at 25 cents in used machines and drove a used ford compact servicing after work. Many years later  I now have a fleet of vans  and singles, racks, cranes, amusements etc etc, The answer is totally dependent upon YOU and how YOU specifically operate. No one is trying to be evasive just honest. I know operators that have 60 heads I know one that does 6000 heads by himself. The profits per head between the two can not be generalized.

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I hear what you're saying. Big difference between a guy running 50 spots a month and the guy who's spent years culling spots and refining his service processes. But I think the question as I asked it can be reasonably estimated. 10 locations...50 locations - I agree luck could wildly impact that one way or the other. But 700 locations? Industry averages take hold at that number.

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Musser has the best answer... and it is the same answer I am going to give you..

 

Where do you draw the line?  if you draw the line at $8 / month then your average will be above $8..  if you do not draw a line, will you take single bay garages?  takeout Chinese food that only does delivery business?  A dentist office!!   

 

back when we did a lot of three head candy machines we had to draw the line at about $15/month depending on proximity to other machines, and product selection..  our average was in the upper mid 20's/month.  If we went for everything and kept everything we landed, our average would have been below $5 and inventory would not turnover fast enough. 

 

When we started our business we would chase after $10-15/month stops..  as we grew, our line shifted.. now we do not knock on those doors..  WHY? Because our sales time is our bottleneck.. whichever form of vending can answer these four questions best, is where we invest our money and time... 

 

Return on investment

return on time (service, banking, vehicle maintenance etc...)

Cost/time to acquire account

LIFETIME VALUE OF ACCOUNT (attrition rate)

 

Single and double head gum and balls are the most attractive segment of the bulk vending industry using my lens...  They don't jam like capsules, they are steady earners.. you will never get stuck with stale product, and you can extend the service cycles to increase your return on time.. the lifetime value of account is high, and they are the easiest machines to place.  Keep your life simple and stick to those...  

 

 

I know that was not the answer that you were looking for.. you want a number...  so I will attempt to give you what you want, but it will not be accurate because there are too many variables regarding expenses.. 

 

Our experience with a large sample of accounts and all types of vending is that the 80/20 rule applies... 

 

Change your question and poll what the top 20% of single head gumballs make....  most people are not going to have a minimum line as high as the top 20% of another vendor...  therefore, the "mean" of the top 20% will allow you to get a closer answer.. 

 

Assumptions: 

you do not draw a line and you take whatever your locator lands..

your top 20% gross $30/month

Your bottom 80% gross $5/month

 

your average is $10/month

 

It takes the same amount of time to pull $80 out of a head as it takes to pull $25  your service costs depend on how often you want to fill machines.. and how far you have to go to fill them.     

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I agree with almost everything that's being said. But we're introducing variables that aren't related to (impact) the original question. Variance between 50 singles and 6000 singles, racks vs singles, lifetime value, while interesting and valid, have nothing to do with the question.

700 single NW60's with no replacements by a reputable in person locator - over/under $2800/month? Your life is on the line and you have to guess based on that set of data points.

Who cares if it's guess, it's just a game.

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The russian mafia then kidnaps your wife and her life depends on you correctly betting the over/under on the above route netting $2800/month after ALL expenses. Which would you choose?

 

 

Why is it like like nailing jello to a tree - getting this question answered?  

 

 

Of course you aren't getting the question answered.

The whole scenario is based on your very large assumption that we want our wife back!

 

                             troll-gift.gif

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Ok.. so lets assume that the Russians tell the locations that after 1 month the machines are pulled from the floor and can no longer earn money..  when the month is up you are to pay a service person $11/hr up to 40 hrs and $17/hr over 40 hrs to buy product, collect, fill all machines, and take money to bank on Friday night.. 

 

sams does not stock 33+cases of gum.. so you have to send your guy to 4 different locations. 

 

Assume the machines are placed a lousy 20 minutes apart.. 8 miles apart.. (not an efficient route) and are located in all directions

time to get off of road, park service and get back on road is 5 minutes.  Time to hit sams is 30 minutes. time to fuel up and get coffee is 10 minutes/day, and time to weigh quarters and go to bank is 1.5 hrs/week..  your employees wife was not abducted, so he has to be home for dinner and can only work 10 hrs in a day.

 

The employee would only be able to service 19 locations /day.. gas would cost about $12/day in a compact car, wages would average 122/day@50hrs/week... product cost = assume 12% cog sams charges $25/case 850 count.

 

 

How much would you need to make / week to hit the 2800 mark?

 

profit = revenue - variable expenses (134 service cost & 19X*.12 is product cost) takes 34 days to service whole route(700/19=34)...

 

2800 =34 (19X - (134+(19X*.12)))

 

X=13

 

YOU NEED $13/month TO HIT YOUR MARK..

 

Let the machines "cook" 6 months@ $10/month revenue..

now your total rev/day is 1140

total costs = 134 + (1140*.12) = 270

net income/day =870

net income/machine=$46

Total Net income = 700*46=32200!!

 

Now divide the 32,200 by 6 months to get your monthly net income

=$5,367

 

See what I mean..  it all depends.. 

 

**this model does not assume any taxes, or workers comp.. state disability etc. because you are dealing with Russian mobsters..  they don't pay taxes**

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if you pay 30% commission on the first example your average/month goes up to 19.63

 

2800=34((.7*19X)-(134+(19x*.12))....  X=$19.63/month

 

employee can service 40 machines in a day?

700/40=17.5days of expenses

2800=17.5(40X-(134+(40X*.12))),,,,  X=$8.35/month

 

now assume 30% commission @40 machines/day...

2800=17.5((.7*40X)-(134+(40X*.12)))...  X=$12.67/month

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Great post dog. the only possible answer is that the average depends on what the operator sets as a goal. If you took EVERY possible location you could get the average would literally be a dollar a month, but no one does that, they relocate losers, the average depends on the threshold YOU set as a goal. I can take ten dollar a month single stops or only $1000 month redemption stops the average depends on me and nothing else

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Who said anything about an employee or commission? Those variables, again, have nothing to do withthe question. I contend the average couldn't be $1/day given one of the parameters I set was having a "reputable in-person, locator". If you disagree, then your answer to the question os obviously "under".

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Where are you at? Orlando?! Lol

 

I'm in Iowa. I have no explanation for the hostility toward bulk vending in my city. If I go south to Iowa City, nearly every place has a bulk machine and they'll let you put machines in. Here in Cedar Rapids, everybody hates them and it's incredibly difficult to locate here.

 

As for the LRU experience, I have no idea what their deal was. They claimed their VOIP phone system didn't work in my area. Strange, since I'm pretty sure that Kickstart uses a similar system for their people (I'm assuming their call center is offshore, too). Kickstart has placed several machines for me without any phone problems.

 

You're actually at the top of my list for locators that I want to try. I think one of things that hurts in my area is xenophobia. People here are very suspicious and closed to anyone who sounds foreign. I think that's one of the reasons telemarketers have such a tough time finding locations for me in my home city. Iowa City, on the other hand, is a very racially and ethnically diverse University city and I think that's why I've seen such good results there with telemarketers. I think getting a native sounding American like yourself would greatly increase my telemarketing success in Cedar Rapids.

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I'm in Iowa. I have no explanation for the hostility toward bulk vending in my city. If I go south to Iowa City, nearly every place has a bulk machine and they'll let you put machines in. Here in Cedar Rapids, everybody hates them and it's incredibly difficult to locate here.

As for the LRU experience, I have no idea what their deal was. They claimed their VOIP phone system didn't work in my area. Strange, since I'm pretty sure that Kickstart uses a similar system for their people (I'm assuming their call center is offshore, too). Kickstart has placed several machines for me without any phone problems.

You're actually at the top of my list for locators that I want to try. I think one of things that hurts in my area is xenophobia. People here are very suspicious and closed to anyone who sounds foreign. I think that's one of the reasons telemarketers have such a tough time finding locations for me in my home city. Iowa City, on the other hand, is a very racially and ethnically diverse University city and I think that's why I've seen such good results there with telemarketers. I think getting a native sounding American like yourself would greatly increase my telemarketing success in Cedar Rapids.

All of my staff is from the US. I think your on to something though. They're are lots of people that are against talking to people from other countries due to the jobs being sent else where, but it's going to happen.

And yes, they both use Skype to call I believe.

On the rack being serviced in 20-30 min, I'll admit it's newer to me, but I have to fill every head, and usually change the product every service (60 days) ago it doesn't go stale. I also pay while I'm there. The end result is 450-550 gross and everything but gumballs is .50, and 2" 1.00.

It might take me a little longer to service that than normal, but it works. Most of my racks are a lot less time.

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I can say from my early experience that profit depends also  from coins size!

Here in Australia I have uturn machines taking only $1 and $2 hence  if people put 3 coins a day per site is a minimum of $3 per day.

So if you guys are making $15 from one machine means that 60 coins by .25cents has been put in your machine. If that would happen to me would be a minimum of $60 bucks per machine.

 

Here you can find machine taking a mimimum of 20cents (rare) $1 and $2 coins.

 

I'd like to have a discussion about this with you.

 

 

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